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Viacom Tells YouTube: Hands Off

In a sign of the growing tension between old-line media and the new Internet behemoths, Viacom, the parent company of MTV and Comedy Central, demanded yesterday that YouTube, the video-sharing Web site owned by Google, remove more than 100,000 clips of its programming.

Viacom, along with other major media companies, including the News Corporation and NBC Universal, has become increasingly frustrated with YouTube as it has amassed a vast library of copyrighted clips, placed on the site by its users.

While such companies regularly ask YouTube to remove their material, Viacom’s demand, which it disclosed in a statement circulated by e-mail, was the most militant and public move of its kind so far.

As it has with the similar request from other companies, Google removed the Viacom clips from the YouTube site yesterday.

The dispute underscored the tense dance that major media companies are doing with Google, which bought YouTube for $1.65 billion last October. Google hopes to strike deals that will give it the rights to mainstream programming and also wipe away its potential liability for any violations of copyright law by YouTube so far.

Despite intense negotiations in recent months, Google has not been able to announce any such deals with media companies. YouTube is supported by advertising, but in most cases it does not share that revenue with copyright holders.

Viacom is particularly unhappy because so many of its shows, like “The Daily Show With Jon Stewart,” a YouTube favorite, appeal to the young audiences who visit the site.

“We cannot continue to let them profit from our programming,” Philippe P. Dauman, Viacom’s chief executive, said in an interview. Mr. Dauman said that Viacom had been in discussions with Google for months, but that Google kept delaying and did not make what Viacom saw as a serious offer.

David Eun, a vice president for content partnerships at Google, said that his company had been “very serious” about the talks, but that the companies could not agree on financial terms. “We put in a lot of time to figure out what would be a mutually beneficial deal,” he said.

A Viacom spokesman said the company had repeatedly asked YouTube to filter out its programming automatically, but that Google had not responded.

“They choose not to filter out copyrighted content, “ said the spokesman, Carl D. Folta. He added that the company apparently had the technology to filter out pornography and hateful material, which is rarely seen on YouTube.

Chad Hurley, the co-founder and chief executive of YouTube, said the company was still working on its filtering technology. He said it had agreed to use it to identify and possibly remove copyrighted material from Warner Music, and it would discuss a similar arrangement with Viacom as part of a broader deal.

Mr. Folta said he found that stand unacceptable. “They are saying we will only protect your content if you do a deal with us — if not, we will steal it.”

Photo

The Colbert Report on Comedy Central, a Viacom unit, is popular with young viewers, and clips from it appear frequently on YouTube.

Whether YouTube is stealing content by serving up clips of copyrighted programs is very much up for debate. Like most big Internet companies, Google says it is protected by the Digital Millennium Copyright Act, so long as it removes material whenever a copyright owner requests it.

John G. Palfrey Jr. , the executive director of the Berkman Center for Internet and Society at Harvard Law School, said Google may well be able to use this defense, but “I don’t think the law is entirely clear.” And if Google loses, “the damages could get astronomically high,” he said.

Viacom’s move comes at a time when it and other media companies have contemplated creating a service to rival YouTube. There have been off-again-on-again negotiations among a variety of companies, including the News Corporation, NBC Universal and the Walt Disney Company.

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Viacom’s cable networks, meanwhile, are increasingly putting clips from their programs on their own Web sites and selling advertising on them.

In the face of uncertainty, media companies have taken different approaches to YouTube. For the last year, NBC Universal has demanded that the site remove most clips of its material, other than a small set provided by NBC itself. Others, like CBS, have largely allowed their content to remain on YouTube. CBS has struck a deal to provide some clips to YouTube and share in the advertising revenue associated with it.

It was not clear yesterday how Viacom’s demand might affect the rest of the industry and whether other media companies would follow suit.

Andrew Butcher, a spokesman for the News Corporation, which owns the Fox television network and the social networking site MySpace, said his company supported Viacom’s move. “They’ve got every right to protect their content in whatever way they deem appropriate,” Mr. Butcher said. “So far we’ve been dealing with YouTube and others on a case-by-case basis.”

Reports have been circulating in the industry that Google had offered to pay $100 million a year for the use of Viacom’s programming.

Mr. Dauman of Viacom denied there had been a deal on the table. He said Viacom “never had any kind of an agreement with Google that it could say yes to,” adding: “There was not enough to be a detailed offer. They have shown no sense of urgency to enter into an agreement with anyone.”

Some analysts said the removal demand was simply a business tactic on Viacom’s part.

“This is a negotiating strategy to get paid, and I think both sides need a middle ground,” said Michael Nathanson, a media analyst at Sanford C. Bernstein & Company. “Both sides have clear needs in this negotiation. What they are arguing about is price.”

Viacom’s demand was “a risk worth taking,” Mr. Nathanson said. He and others pointed out that the music industry was once afraid to take a similarly aggressive stance when its product appeared on the Napster music-sharing service. “If content is available free and it is tolerated, it erodes your core business,” Mr. Nathanson said.

But others said the move could hurt Viacom if young YouTube users become angry when they upload clips to the site and realize that Viacom is insisting that they be removed. Yesterday, Google tried to position Viacom’s move as hostile toward YouTube users.

“The biggest feeling we have right now is regret that Viacom may miss out on the chance to interact with the YouTube community,” Mr. Eun said.

The effort to integrate old and new media has made some inroads. Just a few months ago, Viacom and Google were cozying up so successfully that Viacom struck a deal to have Google distribute clips from its shows on its Google Video service. The deal included an arrangement for the two companies to share revenue from adjacent advertising. Mr. Dauman characterized that deal yesterday as an “experiment.”